91-day T-bill yield rises to 0.919%

Yield of the 91-day treasury bills on Wednesday went up 22.9 basis points to an average 0.919 percent as rates continue to normalize in the bond market.

Wednesday’s average for the benchmark bills was 43.1 basis points lower than the corresponding rate set for deals in the secondary market, which settled at 1.35 percent.

Interest rate on the 182-day bills rose 43.3 basis points to an average 1.115 percent but the yield of 364-day securities went down 67.1 basis points to 1.079 percent.

The average rate for the 182-day bills was 38.5 basis points lower than the 1.115 percent for done deals at the Philippine Dealing and Exchange Corp. The average for the 364-day bills was 62.1 basis points lower than the 1.079 percent at PDEx.

National Treasurer Roberto B. Tan said the results “are very welcome given that the rates are now adjusting toward the secondary market levels.”

“There’s now a movement toward normal interest levels for the short tenors,” Tan said.

He said investors put forward aggressive bids, which tightened the difference between the 182-day and 364-day bills to just about 3 basis points.

“It looks like 364 days is the preferred tenor for many investors, but shorter-term investors may have a different tenor preference because of the nature of their funds,” Tan added.

The government raised a total of P9 billion as planned, as buyers tendered a total of P21.46 billion.

Tenders for the three-month bills reached P5.18 billion, or more than twice the P2 billion offer. Bids for the six-month and year-long securities totaled P8.6 billion, or almost thrice the P3-billion offer, while those for the year-long bills reached P7.67 billion, or almost twice the P4 billion on offer.

Tan said the Treasury needed to redeem 182-day and 364-day bills totaling P10.78 billion, of which P5 billion would be paid out through the agency’s sinking fund.

The Treasury is required to maintain a fund that will enable it to redeem maturing debt paper without having to rely on new borrowings.